Vickrey Auctions for Railway Tracks [chapter]

Ralf Borndörfer, Annette Mura, Thomas Schlechte
2009 Operations Research Proceedings 2008  
We consider an auction of slots to run trains through a railway network. In contrast to the classical setting for combinatorial auctions, there is not only competition for slots, but slots can mutually exclude each other, such that general conflict constraints on bids arise. This turns the winner determination problem associated with such an auction into a complex combinatorial optimization problem. It also raises a number of auction design questions, in particular, on incentive compatibilty.
more » ... ive compatibilty. We propose a single-shot second price auction for railway slots, the Vickrey Track Auction (VTA). We show that this auction is incentive compatible, i.e., rational bidders are always motivated to bid their true valuation, and that it produces efficient allocations, even in the presence of constraints on allocations. These properties are, however, lost when rules on the submission of bids such as, e.g., lowest bids, are imposed. Our results carry over to "generalized" Vickrey auctions with combinatorial constraints.
doi:10.1007/978-3-642-00142-0_89 fatcat:bew6tzms45gadbctoc54a3lhsi